ABI welcomes OFT credit hire focus

Insurers have welcomed the Office of Fair Trading’s focus on credit hire costs.

Commenting on today’s OFT announcement that it is mounting a call evidence into the UK private motor insurance market, ABI General Insurance Director

Nick Starling said: “The OFT and insurers both want the best possible deal for consumers so we welcome today’s report. We are particularly encouraged that the OFT recognise the highly competitive nature of the market and the scale of the personal injury problem facing motor insurers – something we have been arguing needs to be rectified for years – and we look forward to continuing to work with the Government to improve the personal injury compensation system.

“The industry has long said that there are unnecessary costs in the system and that there are inefficiencies that need to be addressed - from personal injury to credit hire to credit repair - and we are pleased that the OFT have recognised this in their report.

“As an industry we are absolutely committed to taking action to improve the market for the benefit of consumers and are already working proactively to develop market practices to remove unnecessary costs that drive up car insurance premiums. We look forward to continuing to engage with the OFT as they undertake their market study and we hope that this will lead to improvements in the industry and lower premiums for our customers.”

LLoyd’s Market Association underwriting manager David Powell said: “We are pleased that the OFT has recognised that excessive personal injury and credit hire costs have contributed to the recent increase in private motor insurance premiums.  

“We welcome the OFT sector study into vehicle repair and credit hire announced today, which should throw further light on any inefficiencies in the market, and we look forward to participating in the debate. It is also appropriate that the OFT will review the role of all service providers in the motor insurance supply chain, given the vast sum of unnecessary costs – ultimately paid by customers – that are generated by middlemen acting for non-fault customers.”